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Priceline.com CFO quits and staff face axe
Auction site boldly goes where many dotcoms have gone before
Flawed and loss-making auction site Priceline.com is looking even more precarious with the announcement that its chief finance officer Heidi Miller has packed her bags and 16 per cent of the staff are to be fired. The news came complete with some poor Q3 results.
Miller had been in the job less than a year and had come from Citigroup where she was one of the top female execs. Her move to Priceline was sold as the Internet revolution taking shape. Another high-profile figure for the company, William Shatner - who did the site's ads - was also exposed as having never used Priceline.
Sales of airline tickets through Priceline have been far lower than expected. At least that's what it blamed a $2 million loss on (from a $341 million revenue). This is an improvement from the $12 million it lost in the same quarter last year, but even so, the company's continued loss has led to cost-cutting. That means a P45 for 87 of its employees. Other bad news? A TV show based an entire programme on Priceline's high incidence of customer complaints. One of its affiliates went under last month, raising large questions about the business model used.
There's more. Lawsuits have been filed against three Priceline directors, accusing them of profiting by selling company shares before its dreadful results were announced last quarter. We're talking $247 million apparently. What else? Share price peaked at $104.25 in March. It's now at $6.85. Oh dear, oh dear.
However while we were checking out this story news ed supremo Rob Blink Blincoe remembered that Priceline was supposed to be launching in Europe very soon. We hadn't heard anything about it. No wonder. We called up the company and were informed that it was launched this Monday but very very quietly. "Discreet" was the word used.
Now, we could be nasty and say this is a reflection of the company's terrible state, but then Priceline's spokesman presented a good case: "It's a discreet launch and only has the airline product to start with. The reason why we did it was because of the high-profile failures of for example online banks like Egg. There'll be a gentle ramp-up of products and then a big £10 million marketing campaign in January for when everyone is so depressed after Christmas that we want to get on a plane and have a holiday."
The european site can be found at www.priceline.co.uk. ®